to rally. >> mason, you are next. >> the big, bad european dragon came out in force today. the italian elections were kind of like the greek election. spain has got 26% unemployment. uk is in a recession. sequester talks are all around to cause the market to drop 200 points today, 150 in the last hour. there's key levels that have been breeched in terms of interest rates. >> okay, what about tomorrow, quickly? >> a bit of a reversal. too much that happened in the last hour today and i think we'll see that. >> all right, t., you are next. >> looking for moderation in the improvement in the case-schiller that comes out tomorrow in the housing. manufacturing data in the consumer data to disappoint. part of that is due to the normalization of social security tax rates as well as the increase in gasoline that we've seen here just in the last month. having said that, as i look at

my clients' portfolios, i'm looking to be more defensive. i'm looking, not already added some gold mining positions in your portfolio, to consider those. those are looking extremely attractive. >> thank you, gentlemen. get you caught up on the day one more time before we turn it over to mandy, who is with the guys on "fast money" today. a down day, no two dways to loo at this. the dow losing 154 points, just in the last hour of trading, whether it's the italian elections or getting ready for bernanke's testimony over the next couple of days. whatever it was, the worst day for the dow and the s&p of the year so far on the nasdaq down 45 points today. >> ugly day, and heavy volume, as well, which is what worries some of the traders down here. and the selloff confirmed by a selloff in the transportation average. for the dow theorists, that's something they watch tomorrow. >> that does it for "closing bell." thank you for joining us. >> maria will be back tomorrow. "fast money" starts right now.

and live from the nasdaq market site in new york's times square, i'm man dip drury, sitting in for melissa lee. this is what we're following. fed up. how worried should you be that the fed is reigning in the easy money? luxury in limbo. it's a mixed bag for the high end retailers. william loauder is going to joi us. and china bull. the top performing chinese stock fund manager givens you his top picks for a rebound. but first, let's get straight to the traders, stocks losing steam into the close. the dow and the s&p posting their worst day of the year, as the italian election weighs on confidence. tim, what did you make of the trading action today? big selloff going into the close. >> it's the macro, mandy, and welcome. we got a fresh whiff of the garlic from the garlic belt. be careful of a miracle that

seemed too good to be true. this is europe. it's not fixed. it is not necessarily better. the divided parliament in italy, not a big deal. this is not greece. but when you look at the entirety of what people had priced into europe, when you look at how oversold treasuries were, how gold was, how overbought the s&p was, look at the move that the yen has had, we haven't seen these types of moves all year and in many cases, we haven't seen these in months, so, the big macro guys are out there, they were moving stuff around and we had big volumes going through. >> interesting to see what people still care about. happened a couple of weeks ago with europe, people still focused on europe, everyone thought that was in the rear view window. between that, bernanke, this is what people are still focused on. it's still here. >> what about you, karen? >> you know, we don't really trade a lot. it was -- i thought it was pretty orderly and not so particularly eventful. that last half hour, though, was fairly ugly. you know, we didn't really step in and buy anything. i have macy's, their coming out

with earnings tomorrow. i like to get back to fundamentals and see what companies are earning and what their uplook is. i can't trade around berlusconi or not. leave it to this guy. >> you guys use the word orderly. that's what we saw. the s&p had been trading significantly higher early. when you look at what cracked first, the backbone of the market rally, the financials. if you look at the xlf, it was trading up to almost the 52-week highs, up near that 1790 level, just about. and then we started to pull back. when they went negative, long before the s&p, is s&p was ho holding itself, but then the official financials, they cracked and that started to accelerate throughout the day. later in the afternoon, the fear factor, the momentum started to come in there. and i think some of the opportunities that we're looking for in the marketplace, one of the opportunities that i saw with amazon. that's one of the names, we can never get our arms around this name. we have tried to talk about the pe levels, how can we own this

thing? i don't know if you have a great answer for that, other than the fact that it performs so well. but in amazon today, as it was selling off, as it got up to that 268 level and got to 264, it closed well underneath there, closer to 259, but there were buyers of the april 330 calls. why were those up when the stock was reversing and pulling off? i think there's opportunities, i actually shifted down, put on some call spreads on amazon today, looking for any time over the next eight weeks or so, for a big move in amazon. >> i got pulled back into google. i was away last week, i sold it the friday before i went away, thinking about not managing my position when i was on vacation. i came back, i scrambled to buy google again today. obviously i could have waited. it closed exactly where i sold it on the previous friday. so, a lot of people still getting sucked back in. >> i would like to know, tim, to what degree is it a justifiable reason to sell off because of the italian election or do you think people are just looking for an excuse to sell?

>> i think it's a combination. i think people are looking at some of the trends. the yen trade is the bigger trade to me and this is a part where i think hedge funds have had a very good run. i think guys have taken profits and i learned from the big broker dealers that a couple of stops were triggered. i look at the treasury trade. don't discount the fact that the ten-year broke through significant resistance. we have a fed testimony tomorrow, we have a lot of news in the market today, talking about possibly the fed won't be as aggressive in turning off the faucet. the s&p, technically, is at levels at 1476, people are going to be watching this thing, if it doesn't hold, we could have more down side. it's not that anything has deteriorated overnight, but people are estimated where trades have gotten long in the tooth. >> okay. in the meantime, let's go more on today's market move. the fear trade. really taking off. josh lipton is back at hq with all the details. josh, take it away.

>> hey, lots of fear in the market today, mandy. the vix, otherwise known as the fear gauge, spiked over 34%. its biggest one-day move since august of 2011. another measure of fear, the flight to safety. out of risky assets and into the relative safety of treasuries. the tlt popped some 2%. add to the dollar, the dxy, which measures the greenback against a basket of its rivals, also higher on the day. mandy, back to you. >> josh, thank you. pete, you're the expert on the vix, right? big move here. >> there are three catalysts for what we can see the market to pull back. one of which is $4 gas nationwide. that's always an issue that we talk about. when you look at interest rates 2.25. volatility indeck, plenty of call spreads, very smart traders. because of the way this is expiring with the options in the volatility index, the problem is, how do you actually execute

the way you like to? you do it through spreads. they were coming out, buying the 2025 call spread. only putting 30 cents, a $500,000 trade put on today. those are looking for this market to get above the 19 level where we are right now, which is well above the rest of the curve, most of which the volatility, trading to 17 1/2 below, but the front term vix right now, definitely exploding. people expected over 20. >> how good an indicator is it, though? >> fantastic. i heard from so many people recently, because everybody is an expert on the vix. everybody is telling you about it, it's meaningless, all the rest of it, no, it's not. plenty offal toings out there. the guys in the pits in chicago are right on, just like steve out in the pits. when you see that paper that's flowing in there, they have been watching this paper, the accumulation of upside calls, waiting for this type of day to happen where we started to see pressure, the acceleration of pressure and suddenly, if you look at the hundreds of thousands of open interest in

the vix to the upside, people have been expecting this move and now they're getting it. >> anyone beg to differ? >> would you be a seller of that volatility or a buyer? >> i wouldn't be a seller yet because just like john and i were talking about, we talked about, as you get closer and closer to all of what's going on the government side, that's -- we've been -- we were over 21 back on december 28th on the volatility, closed above that level. pulled all the way back and here we are once again, pushing on that. i think we hit 22 soon. >> you know, for me, though, the government side of it, we've seen the republicans back down a number of times. i have no reason to believe this is not going to be squashed, the same way we worried about stuff. it is more about europe, bernanke at this point. it's not about the debt ceiling. it's not about that, for me, at least. i don't know where it's going. but this is the best way to get protection in this market. >> reminding you, it's the last week of the month, a month where a lot of guys have had a very good month yet again and a lot of profits are being locked in. if you look at levels, there's no reason to hang around to the end of the month. that's adding to volatility.

a lot of the volume move on much of this move this month was not significant. today was emphatic. there was volume out there and guys were selling. >> i'm going to put out a penny jar and i want a penny every time i hear profit taking today. >> i owe you some money. >> that's why i said it. dig deep. another big test for the market could come tomorrow and wednesday because that is when the fed chair, ben bernanke, is set to testify before congress. will he signal that the days of ultra easy monetary policies could be coming to an end? and if so, whow big of a worry s that? let's bring in the fed whisperer himself. he's live from d.c. >> hey, mandy. >> what has the fed been whispering to you? >> ah, i don't know how i feel about the fed whisperer line -- >> how about blue horse shoe? >> a couple of things, i think bernanke is going to do three things in the next couple of days in his testimony.

one, keep his options open. the felt's got a meeting coming up, march 19th and 20th. he doesn't like to get out in front of his committee. he's not going to come out and signal a big change in policy in the next couple of days before he has a meeting with his committee. it's important to him to keep his options open. at the same time, there's two cross currents he's got to navigate. one is, when he talks about the economy, i don't think he can signal that he's very satisfied with how the economy is doing. we still have unemployment at 7.9%. you want to see substantial progress. they haven't seen it. so, dissatisfaction on the economy front. but the third one, and we've been talking a lot about this lately is, the financial stability issues. what's happening in markets? you know, the fed chairman, he's got to signal that he takes these issues seriously. there's been a lot of talk, for instance, governor stein has talk about froth building up in the credit markets. bernanke has to make clear that he takes those concerns

seriously. so, he's not going to dismiss those worries out of hand. >> but john, i hear you saying a couple of times, and as much you are blue horse shoe, making the wall street reference, it does seem to be about communication and it seems to me that the fed right here now is testing the market. because you made a point in your article to say, it's either about tapering or it's about essentially turning off, i'm sorry, drawing back the faucet. tapering the first thing we need to think about. but right now, people still have a fed with the pedal pressed to the metal. don't you think they're really trying to sound out the market here and don't you think that's what some of the other players, not necessarily yourself, are trying to feel out for them? >> i think that's kind of funny. you know, the fed doesn't -- people at the fed don't spend all of their time thinking about the market. it's -- they're not, i mean, the market spends a lot of time thinking about itself, but the fed, who are they testing out? w who are they feeling out?

they are trying to come up with the best strategy that they could come up with. >> but unlike green span -- >> they're sending out trial balloons -- that's not what's going on here. they are having an honest to goodness debate about -- >> that can be dangerous, john. i agree with you. i don't know they are saying, hey, let's fly some balloons into the market. bull per n but bernanke is a communicator to markets, to be transparent. this is a problem, because people are overreacting to some of the things he's saying. >> well, so, you know, i think one of the things that bernanke wants is for people to be away of the felt's own uncertainty about how things are going to play out. one of the problems that we had during the housing bubble was that the fed made things very clear for everybody. they said, we're not going to raise rates. when we do, we're going to do it at a measured pace the market got overconfident with that. i think this fed chairman is comfortable with the world seeing these debates kind of unfold in real time.

and that's exactly what we're seeing right now. we've got some fed officials, you know, couple people that i've been looking at very closely, sandra, jeremy stein, who are saying, you know, they're a little uncomfortable about what they're seeing happen in credit markets. we've got over fed officials who are saying, it's not time to worry about that. and there's a debate happening and the transparency that bernanke feels comfortable with is, people seeing that play out in real time. you know, he's going to give his signals when he's ready to give them, probably at the next fomc meeting. i think he keeps his options open at this and acknowledges the worries about financial stability but also what the doves are saying, that the job market is really weak. >> absolutely. very divided. >> if the market is uncertain and uncome fortunatable with that, that's just the way it's going to be. we live in an uncomfortable world. >> thank you very much, john. in the meantime, ahead on "fast money," where one top fund

manager is putting his money now. but first, estee lauder executive chairman almost lauder is going to join us in a cnbc exclusive. how smaller paychecks are effecting luxury spending and more. let's look at how the s&p futures are sitting right now. this is very early indication. lots of things can change between now and the 9:30 eastern open tomorrow morning, but nonetheless, it is indicating a much lower open.

welcome back to "fast money." i'm josh lipton. financials, the hardest-hit sector today, down about 2.7%. morgan stanley led the way lower. worth noting here, their correlation with the euro over the last six months has been almost perfect. in other words, as goes the common currency, so goes morgan stanley. today, the euro weakened to its lowest level since january 10th against the dollar. mandy? back to you. >> thank you, josh. let's drill down a little bit more on the action in the financials today, which, as we just saw, was ugly. anton schutz is with us. why do you think financials were the hardest-hit sector today?

>> well, there's no doubt that the large cap financials really correlate to the weakness or strength in europe. and there's no bigger proxy than morgan stanley and citi. the risk offtrade were in full force today. people were surprised and people sold first and asked questions later. >> do you think we the damage we saw was justified? is there a buying opportunity right now in these? >> day-to-day, i'm not sure there's a buying opportunity. but as volatility rises, i would like to sell puts. that's the way i kind of like to do it here. i do think that morgan stanley is a value guy's dream, it's cheap below book, it's been cheap for awhile but it finally broke out to new heights. the things i expect eventually, i mean, buyouts and mna are daily headlines. ipos are coming again, cap rises are active. will we get past the european headlines again, will we get past se quest trags? we do, morgan stanley is a buy

and i expect the names to have a very good year if we don't really blow it in the white house or if we don't have europe go full bore again. >> karen? >> anton, it's karen. so, you would wait then until there's a resolution on those two things? >> no, i just want fear to go a little higher. i'd love to have volatility go higher and sell some puts on more began stanley. >> so, you would rather be a puts seller than own the stock? >> well, i do own some stock. it's partially hedged. but i like to take advantage of volatility. when it rises today where i don't have any put positions, i've sold in my funds, i'm looking to take advantage of a rise in volatility so i can get entry prices that could be attractive and get paid for that. >> anton, morgan stanley are the most effective if europe immroeimplod implodes, would you play it with a goldman sachs, or they least effected, granted, they trade at one group, but goldman seems to be performing technically, up until last week, outperforming the group on a technical basis.

>> goldman has outperformed the group in a big way. and morgan stanley has clearly taken the viewpoint of being the proxy for europe. if you look at the drops today in the two stocks, morgan stanley dropped far more than anybody. and, you know, tomorrow, we get an interesting data set that we get jpmorgan's investor day. i think we'll get more about the health of the capital market. i think it will be good news for the whole group in order to hear some clarity in how they see their business. >> thank you for that, anton. what do you reckon, guys? where do you go here? >> first of all, if we're talking about european troubles being the catalyst for today's move, go after deutsche bank. there's a lot more to go here. and certainly the pressure on euro, a lot of people are going to be rolling back in the swiss francs. the swiss banks and deutsche bank are the ones that have had the biggest run higher. they are the most higher. >> to anton's point, though, when you look at the volatility of the financials, in the single

day, you aren't seeing the explosive moves in the imflipped volatility of these options yet, if that's exactly the strategy you want to do. we talked about for weeks how rolling out of long stock positions as we got through 1,500 and getting into option position, because they are so inexpensive to the upside. you're not getting hurt to those that are long bank of america calls, citi calls, goldman sachs, morgan stanley, go through the list. >> so, are you getting paid to sell vol here? >> not enough. you aren't getting paid enough yet. i mean, it's a single day. we were talking about this morning trading near the 52-week high of the xlf. you did not see the explosive move to start selling those premiums. >> okay. time now for pops and drops. the big movers of the day. let's start with a pop, barnes & nob noble, popping 11%. karen? >> yeah, you don't see that very often at all for barnes & noble. interesting story that riggio may decide to buy the bricks and

mortar part of their business. that is an interesting event, if it happens, but you have time to wait and see if it really does and exactly he's offering. >> he's not interest ed in the nook. >> just the retail stores. >> exactly. we have a drop and it is chesapeake and dropping 6%. grasso? >> asset sale. the market didn't like it, judging by the action in the stock price. they need more asset sales. if this is a sign of things to come, stay out of the name. you don't want to be short it because it could explode in your face. and you don't want to be long it. >> they need the cash. we have a drop in joy global, dropping 5%. tim? >> makes a three-day move of over 9%. the miners and the construction equipment makers are getting sold off around the world. that's the story. these guys said they were collecting cash, looking at acquisitions. i don't think you need to own it here. >> not a lot of joy there. okay, a pop, amgen. this is popping 3% today. >> popping based upon the

negative news with the anemia drug, some of the results, we know the story. awful for them, but this is the beneficiary. hitting a new 52-week high. when you look at this name, realize this. you get a nice dividend yield, this is a name in the bio-tech world that has plenty of legs to the upside. beneficiary today, as well. >> okay, we've got a drop for greg p. russell, the oscars are beginning to sound like a broken record for one hollywood insider. the veteran sound mixer was nominated for the 16th time, yet he's never won a single award. russell's latest nomination for his work in the most recent bond film, "skyfall." saw it three times myself, by the way. very good movie. but the man would the golden statue is not alone. kevin o'connell has been dominated 20 times without a win. >> he could win an oscar for looking like wolfman jack. or mike piazza. >> simon hobbs went to school

with james bond. how cool is that? >> daniel craig? >> the resemblance is uncanny. >> i can see it. >> hard to tell them apart. >> love him. >> i would like to see simon try shoot out some baddies. coming up next, a read on the strength of the consumer with william lauder. he is waiting here in the wings. the executive chairman at the estee lauder companies. it is another cnbc exclusive interview. and later on, the man running one of the highest returning china funds in the world. he ittells us whether it is tim to bet big on the region. tdd#: 1-800-345-2550 when i'm trading, i'm totally focused.

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okay, let's take a look at what's going on over at the

mothership. josh lipton, a lot of damage being down in the ewi index. >> yeah, you can check out ewi, which got clobbered tate. it tracks equity performance in italy. down about 5% today, mandy. down 5.7%. most of that coming, by the way, after europe closed. >> timmy, i want to get your call on this. italy, going to bounce back tomorrow? >> i think today's move was ridiculous. today's move was overdone. the move on italy, as josh pointed out, was 5%. this thing, if you look ate, the intraday, it was almost 10%. italians come to expect this type of behavior in their politics. to oversimplify it. and to expect there to be a solution tonight, in fact, we're going to get the final results in about 15 minutes, ultimately, we're going to see a government that doesn't have a strong stand. and a strong mandate. this is something that's going to worry people. but to sell it harder tomorrow, when you're right at a 200 day, i would be cautious. >> this is the italians saying

no austerity for us. >> prego. >> we're joined in a cnbc exclusive by william lauder, executive chairman of the estee lauder companies. i have to ask you, i understand that a third of your business is done in europe, comes in europe. how are you seeing the consumer over there, in light of the fact that europe has had struggling times. >> the southern tier of europe, spain, italy, greece, they are really not in any healthy conditions. the central band of europe, the some what larger economies, france, germany, they're actually okay, not bad. you look at the eastern sector, russia's not bad and further north still, even better still. >> and the difficult regions, do you expect them to bounce back or is this going to be -- >> i wish i was a macro economist. i agree with everything we see and hear. spain and greece, just the general conditions in spain and greece are really tough. italy doesn't seem quite as bad, regardless of any political things, i think it is more business as usual.

the middle tier, germany's pretty solid. germany's pretty solid. france is solid, netherlands, they're actually okay. >> one of the things that we come to expect in the luxury market, a place where a lot of your products are positioned, that asia and china, china is the biggest luxury market in the world, and despite some of the overblown concerns about tiffany, coach, some of the h h higher end guys have run into some sales concerns. you know, what do you guys see there? at the end of the day, you are building a long-term, you know, positioning. asia's 20% of your sales at this point. you guys are well positioned. isn't this really the market to be worried about, rather than europe? >> asia is certainly our fastest growing market. but it's coming from a number of different sectors. we look at the corridors of travel that, because not just chinese consumers shopping in china, chinese consumers shopping in hong kong, in paris, in rome, in london, in travel retail world. so, we look at the entire region. the chinese consumer is very

influential, not only at home, but outside of home, too. and it's really how we sub-segment. tier one cities, the 25 million plus population cities, they're maturing. but the tier two and three cities, the stiffs that are only 10 million or 5 million populations, those are huge cities by western standards, there's a lot of growth going on there. the infrastructure growth in china's going on, they have 50 years of runway to come close to where europe and north america are right now. the chinese are thinking across multiple decades and generations. we're thinking across multiple decades and generations. we're not thinking about what's next week. so, we're building for the long-term. >> so, let me ask you, for your u.s. customer, which effects her most, stock market levels, employ or housing? what's the most relevant factor, or some other? >> from what we can understand, the behavior of the consumer,

employment, number one. spousal partner employment number two, maybe housing as an indicator whether they have disposal income three, stock market doesn't seem to say, stock market's up today, i'm buying something tomorrow. i don't believe that's an influence. >> why do you think estee lauder has outperformed the rest of the group? we started it out that way. we see the problems, but we see your performance is up 11%. what's -- what are they doing differently than you? why are people less worried about this company versus the mixed bag? i know the easy way is to say, you can't comment on other companies, but you must be seeing what you are doing differently. >> first and fore most, most of our real competitors are not in your comparable sector. our real competitors are european-based or asian-based. our core competitors are not the u.s.-traded companies as you see it. those in our sector, we don't compete with directly as much in the stores we compete with around the world. our come pelt torp petitors are,

the pprs, they are our core competitors, they are positioned similar to us, making long-term bets in investing marketplaces around the world, where as most of the comparables in the united states, they are much more mass-oriented, they are playing in a different sector than we are. we are the world's leading prestige marketer of beauty. we compete for that luxury consumer who are spending on themselves because she says, i'm worth it. i have the dispoable next. she choosing to spend in our category because it is easy. $35, $40, $50, not a $500 handbag, not a $1,000 necklace. >> how manageable are your input costs at the moment? and what is your outlook for input costs over the course of this year? >> those issues -- we're not -- it's not as much volatile, because the cost factors for us,

we have a 25% cost to goods. so, if you realize, when you look at the changes that are coming, those are not going to be very meaningful over a medium term period of time. occasionally, in certain markets, when you have a dislocation in currency, those can have a short-term issue, for example, all of the commodity driven current sips like australia, are all of a sudden, they're pricing is out of whack within the world. so, what happens is, the consumer, we're seeing huge aussie buying in los angeles, the number one gateway for aussies interesting the united states. so, any stores, you can sort of draw a circle 20-minute driving circle around lax, they are saying they are 30% aussies buying before they get on the plane to go home. >> nothing like that strong aussie dollar. taking over. thank you so much for joining us. great to have you on the show. in the men time, coming up, is the chinese recovery story the real deal? we have a top china fund manager. he's going to be setting the record straight, right after

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spy, the afterhours trading. looks like it's coming back a little bit. kind of little changed right now. pete, i want to ask you, i mean, what do we do going into tomorrow, do you think? going to be a buyer? >> i certainly wouldn't overreact to this little bit of a blip. i think to tim's point, probably a bit of an overreaction today. but there has been some pent-up folks out there that have been waiting for the opportunity to finally kick themselves, as we got through 1500 and the ask sell ration move to the down side. i think that's part of what we saw today, all the folks that looked at 1500, when we finally cracked, they did believe it and started to sell off. i don't know that the opportunities are going to be on the open. you have to wait through the first couple of hours of the day to see what the trade looks like. >> okay, don't jump too fast. let's go to some street fighting. hewlett-packard seeing a huge boost. shares up 14% in just the past five sessions. the company announcing today it is selling a new defunct

operating system to lg. they are getting ready to launch their android tablet, the slate 7 in april. so, is this turnaround for real? let's kick off the street fight. grasso has been a bull since the stock was around 13 bucks. pete, you are the bear, i believe. you have a total of 90 seconds each to make your case. grasso, kick it off? >> you nailed it. the autonomy bottom that made me bullish on the name. rallied 60%, or there some. i looked at it on an oversold basis. i think the stock can get to $24. that's my bullish call on the stock. if you look at it, while you wait, you get just about 3% yield on the name. cash flow is better than expected. debt levels are dropping, cash flow up. two reasons to buy the name. and you hit it. android tablet. it gives the consumer a better choice. it's actually priced cheaper than the nexus tablet. is the stock overextended? maybe. but i'm in the name and i'm staying in the name. >> part of the problem is, i do think the stock is overextended. when it comes up 50% in a

quarter, i think that's too much too fast. steve and i are actually on the same plane there when we were talking about the stock at 19. when you have four core businesses where your revenue all decreased, that's not a good thing. when you go from $4 down to an estimated $3.50 and you have a ceo saying this is a 2014 story, it's another reason you have to be cautious. stay away from the name. right now, a bear on the name just because of the already move that you've gotten and a lot of people who are bottom pickers. i like that yield, but i can make that -- >> just to jump in, what has been the most negative thing is acquisitions. they performed poorly with that. you're not going to see that again. meg will not put her money on the line because he snows th s the line because he snows the k that's the biggest bearish case for that. the breakup of some of the parts, 28 bucks. >> she said she's not going to do that. >> that number is out there. >> i can throw that argument back to you as far as yahoo! is concerned. but right now, it's trading underneath 20. >> i heard a buzzer, guys. >> that was for pete's time.

not for my time. >> i will say this was a boring fight through the first seven rounds but you really kicked it -- >> let's get the verdict. >> wait to the last round. >> the truth is, the stock price -- >> still going? >> the stock price dictated the winner. we're both on the same page. >> karen -- are you team pete or team grasso? >> i have to go with pete here. >> thank you, sister. >> it's not like they fixed the business. the stock may have bounced a lot but the business is not fixed. >> still a long turn around to go. >> if i can pile on here, $17.50, this stock has significant resistance. the valuation isn't terribly cheap. free cash flow is nice but it didn't help the pe. >> you have a lack of command with pc and printer demand, i mean -- >> i heard the buzzer again. >> can we get the baby crying? >> there it is. >> all right, please do tell you who you think won the street fight.

tweet us and we're going to have the results at the end of the show. okay, onto a topic very close to my heart. having lived many years in asia. chinese manufacturing slowing down in february. the hsbc china pmi number decreased from january, but still showed signs of expansion. the week-long chinese new year are behind that drop. and with the shanghai composite pulling back from recent highs, is now the time to invest in china? well, let's take a deeper dive. we have eric brock, china fund portfolio manager. his china fund returned more than 24% in 2012, which is really no mean feat, right, when you consider the chinese market -- >> great. >> has been kind of struggling for a little while, coming back now. is it time to invest? >> yes, we think it is. if you look at the cyclical indicators. we did havi don't want to pay t attention to the january, february data, because we have seasonal distortions with the chinese new year. if you look at the data in the

last few months, you have cyclical indicators like power generation, where seeing growth 8%, 9%, industrial productions up 10%. exports have recovered. you have the cyclical story here. and now -- i would argue that china has actually entered a sweet spot in terms of economic growth. >> so, you put the hard landing theory to bed in. >> oh, absolutely. 12 months ago, that was a big debate. we've troughed out. what i would say, a sustainable level growth. 7.5%, 8%. more importantly, for equity market investors, we've had earnings headwinds for the last two years. and now we are starting to see earnings in flex. so, the economic growth and earnings is improving. a tail wind for equities. >> sounds like you are focused more on the consumer consumption story, not necessarily staples and what not. so, what do you say to all those people that say, look what's going on with tiffany, we just talked about it with our last guest. to some extent, asia seeing head

winds on the luxury side. where do you want to play? and i've seen that you also have a significant exposure to the banks and that's been a real underperformer, the part that people almost correlate with the discretionary side of that trade. >> i think the discretionary spending environment remains strong. we have seen mixed data, but if you look at the auto sector, continue to stay strong. that's a very big market. the auto market in china is now $20 million. just for some context -- >> is that via bmw -- >> i think what we're seeing is the maturation of the chinese consumer. we're seeing not only luxury sales from foreign manufacturers but suv sales. that was a very small market. obviously a highest price point. but that was a small market five years ago. today, it's booming. great wall motor is a company we own and that's a way to play it. >> is some american or western investors like to invest in china through a multinational say, like, caterpillar, a big

company that's got a lot of exposure to that part of the world, what do you think of that strategy? >> i think china's economy is rebalancing, and i think the growth outlook in china is what i describe as a new growth model. it is going to be increasingly consumer led. if you had that old playbook, as i call it, which included caterpillar, included joy global, freeport-mac, they benefitted from this tail wind in china. it's changing fairly rapidly. i think the services sector, or industrials in commodity complex, the mining complex, that's been overbuilt to a certain extent, to service china's growth is now going to start to see returns diminish. just simply going to be too much capacity. iron othre may be the best exame of that. >> okay, thank you so much for coming and joining us. >> thank you. okay, c nbc's jane wells now joins us with a look at what is next on "fast." jane? what's cooking? >> mandy, how soon before you

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the afterhours session, following the company's earnings report. zynga moving today on the hopes that online gambling will become a reality in nevada and new jersey. with more on both stories, let's bring back jane wells live in l.a. jane, over to you. >> mandy, well, you saw it there in the chart. caesars would love online gambling to make up for the eye-opening losses it reported, blaming most of that on hurricane sandy closing down all five of its casinos in the atlantic city region. losses from continuing operations, losses, were $3.44 a share. this is just for the quarter. that was nearly $1.50 worse than the street expected. cesaring reporting over $2 billion versus street estimates of 2.1. basically half the drop in net revenues being blamed on sandy. nirp from $40 to $45 million out of a $91 million drop. it expects the region will continue to be challenged as a result of the slow recovery from the hurricane and competitive

pressures. oh, that. in vegas, good news and bad news. the good news first. visitor trips for the quarter were down 3%. so-called spin per trip was up over 11%, even as room rates were down. v.i.p. segment improved in both visits and spend. let's bring it back to online gambling. caesars finished it acquisition of bingo blitz. online poker for money legally in nevada. the first u.s. state to do so. new jersey may follow and he says he hopes see sarps has the opportunity to, quote, pursuit online gaming there. online gambling inside of nevada and new jersey cannibalizing the home audience. the hope is that it becomes legal in neighboring states. but new jersey in familiar can be very lucrative and all this hope pushed up zynga shares today. back to you. >> hopium, thank you for using that, jane. let's bring in scott nations of

nation shares, who noticed some unusual options activity in zynga today. scott? >> that's right. looking for something to buy today and a bunch of them were buying call options on zynga. again, on news that nevada had passed online gaming. by the end of the day, the call volume in zynga was four times the average daily volume. now, one particularly interesting trade was a buy of 2,000 of the march 3 1/2 strike calls that paid 28 cents for those. that means their break even is $3.78. that's a really interesting level. while zynga has flirted with that level in february, you have to go all the way back to july to find the last time that the stock closed above that level. >> i will tell you, caesars is incredibly leveraged way to play the space, but it's too iffy for me. i don't want to be long in the name, because there's no type of consistency. rather be longer wynn or las vegas. >> okay, scott, thank you for

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well, fund managers bets are lower, gold prices are at record numbers according to reports. tim seymour says the gold trade is a changing. let's take a listen. >> the correlation of gold miners to the metal is something that may be ending. i think gold miners are going through a transition and it may be slow. people will look at them at yield plays and not growth playing. the valuations are interesting here. >> okay, that was a bit of a rewind there. tim recommended buying harmony and barrick gold. they are down, about 2% since that call, sorry, tim, he's still hammering away at the trade. what do you make of that? >> we talked about a couple of things that give you reason to support that trade. if you think about italy, if fear is back on in europe, we talked about the fed. people thought last week that the fed was running out of their buy-backs, et cetera. if you look at the chart here, here is the other thing that layers into this. gold is way oversold.

this is telling you the professional money managers, the institutional players, where their net gold positions are and if you look, we are back to lows that we hit, the lows in 2008 and back in 2007 before we went into this gold rally. from a positioning perspective, gold is oversold. net longs were down 40%. overall positioning was down 1.6 last week. so, to me, this is a very good time. i like the miners. they have been the most beaten. we talked about last week that they have begun to decor late. a lot of guys have put their hedges back on. they are not as aggressive and not as much growth plays. harmony, i like, gfi. and you can play the oversold conditions. >> what do you think is the main reason for the receiving down of gold? the down dollar story? >> the fed, first of all. the move we've had, call it six weeks this year, as people talk about rotation from bonds and other somewhat less risky assets is number one. then we get the fed minutes, everybody said, oh, wow, the fed

is out. there might be deflation. this is a bad environment for gold. that's the condition. when you have a lot of fringe players and they have momentum guys and today we talked about the macro trades. very big. gold has been apart of that. that's why it's oversold. i think that's created a pretty interesting opportunity. >> you like it at these levels. tim, thank you. very quick break here on "fast money." back in two. with the spark miles card from capital one, bjorn earns unlimited rewards for his small business. take these bags to room 12 please. [ garth ] bjorn's small business earns double miles on every purchase every day. produce delivery. [ bjorn ] just put it on my spark card. [ garth ] why settle for less? ahh, oh! [ garth ] great businesses deserve unlimited rewards. here's your wake up call. [ male announcer ] get the spark business card from capital one and earn unlimited rewards. choose double miles or 2% cash back

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